16-302.   Same; payments, form and deposit of; exceptions.(a) Except as authorized by K.S.A. 16-308, and amendments thereto, all fundsreceived pursuant to any agreement, contractor plan governed by K.S.A. 16-301, and amendments thereto, shall be depositedin a bank, credit union or savings and loan association and shall be held bysuch bank, credit union or savings and loan association in a separate accountin the name or names of the purchaser of the merchandise or services and thename of the seller, until released as herein provided.

      (b)   In addition to the requirements under subsection (a) and except asotherwise provided in subsection (c), a seller which accepts payment under anyagreement, contract or plan governed by K.S.A. 16-301, and amendments thereto,shall:

      (1)   Require such payments to be made in the form of checks, cashier'schecks or money orders payable only to the bank, credit union or savings andloan association where deposited; and

      (2)   deposit such payment in such bank, credit union or savings and loanassociation within seven business days after receipt.

      (c)   A seller of agreements, contracts or plans governed by K.S.A. 16-301,and amendments thereto, shall be exempt from the requirements of subsection (b)if the seller maintains commercial insurance providing minimum coverage of$100,000 against employee dishonesty. A seller of agreements, contracts orplans governed by K.S.A. 16-301, and amendments thereto, which is exempt fromsubsection (b) under this subsection and which accepts payment under any suchagreement, contract or plan shall deposit such payment in a bank, credit unionor savings and loan association within 30 days after receipt. Evidence of thecommercial insurance maintained for compliance with this subsection shall beprovided to the secretary of state within 10 days of a written request.

      (d)   Each funeral establishment which accepts payments from a purchaserunder an agreement, contract or plan governed by K.S.A. 16-301, and amendmentsthereto, and is exempt from subsection (b) under the provisions of subsection(c), shall file with the state board of mortuary arts at the time of eachfuneral establishment license renewal required under K.S.A. 65-1729, andamendments thereto, evidence of the commercial insurance maintained forcompliance with subsection (c). If such insurance lapses, is cancelled orotherwise ceases to be maintained by the funeral establishment, the insurancecarrier shall notify immediately the state board of mortuary arts and thesecretary of state of such occurrence.

      History:   L. 1953, ch. 54, § 2; L. 1973, ch. 86, § 2; L. 1976,ch. 97, § 2; L. 1983, ch. 76, § 2; L. 1989, ch. 48, § 71; L. 1991, ch.68, § 1;L. 1992, ch. 127, § 1; July 1.